BHP Billiton to axe 290 Hunter Valley coal mine jobs

Job losses are set to surge in the NSW coal industry with BHP Billiton wielding the axe at its Hunter Valley operations as hundreds of jobs go at other mines in the region.

BHP said it will slashing 290 jobs at its large Mt Arthur steaming coal mine, reducing the workforce to 1440, as part of efforts to revive the mine's profitability. The mine is the largest in the Hunter Valley with producing around 20 million tonnes of coal annually.

BHP Billiton axing more Hunter Valley mining jobs

Photo: Michele Mossop

The bulk of the output from the mine is sold abroad and it will be seeking to maintain that output, despite the job losses, which has triggered concern with the mine workers union that BHP may seek to boost the number of casual contractors at the mine.

Of those losing their jobs, 230 are covered by employee agreements. The remaining jobs are support roles, mostly administration. It is unclear whether there will be a knock-on effect for contractor jobs at this stage.

"The announcement from the company says it will discuss the cuts with labour hire companies. Our concern is BHP has earlier indicated it wanted to shift to 60 per cent permanent and 40 per cent casual contractors at its mines," said Peter Jordan, the district president for the CFMEU, which covers mineworkers. The CFMEU will be meeting with BHP ti seek to clarify the matter on Wednesday.

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"Are they replacing 17 per cent of the permanent workforce with increased use of casual contract labour? If that is the case, the CFMEU will vigorously oppose that," Mr Jordan said.

Adjacent to the Mt Arthur mine is the Drayton mine where as many as 500 jobs are likely to be axed by year end due to a lack of approvals to develop the Drayton South mine, which will force the closure of the mine, the CFMEU's Mr Jordan said.

As well, 100 jobs are to go at the West Wallsend mine, Glencore's Bulga underground mine will close in 2017 with the progressive loss of up to 400 jobs between now and then, while last week, Yancoal said it would cut 92 jobs in the Hunter.

In the December half, the group's BHP's NSW steaming coal mines posted a pretax loss of $US9 million amid a glut of steaming coal, which has seen the price decline 27 per cent over the past 18 months, BHP said.

Operational and structural changes were essential in enabling Mt Arthur Coal to be commercially viable, and to provide ongoing employment opportunities in the Hunter Valley," BHP said in a statement.

"Despite extensive work over the past two years to reset our production costs and safely improve the mine's productivity, Mt Arthur Coal must continue to significantly improve performance to be a globally competitive operation," head of the group's NSW steaming coal operations James Palmer said. "The changes will put Mt Arthur Coal on a more sustainable footing for the future."